Top of the morning SumCapers! During bull markets, hacks, rug pulls, and de-pegs are usually shrugged off as one-offs and novelties as everyone’s too busy printing money. In a bear though, every unseemly exploit or liquidation takes on a more apocalyptic tone.
It’s rough out there but the bad actors are getting flushed out.
The rapid and consecutive combustion of a **stablecoin - at least just one for now - a whole L1 ecosystem and various centralised firms was, by no means, spontaneous. The contagion spread fast - COVID would be proud. Ultimately, none of these projects were built on Ethereum, and none of them are DeFi native platforms. In fact, the value proposition of the fully transparent and open financial system that DeFi provides has never been clearer in their wake.
This lays out the path for trillions in new capital to flush into the ecosystem and propel it forward. Yes, DeFi & Ether may be down bad but it is certainly not ded!
Total Crypto Market Cap: $921B (-32.77%)
DeFi TVL: $72.54B (-32.55%)
Stablecoins: $144.85B (-6.84%)
In preparation for the Ethereum Merge, to be expected later this year around August/September, developers did something and activated the merge on the Ropsten test network. This means that we are definitely one step closer to activating the PoS consensus layer on Mainnet!
The Ethereum upgrade known as The Merge will merge the Beacon Chain into Ethereum Mainnet, turning Mainnet into a combination of a consensus layer and an execution layer. This separation becomes especially important in the context of the Merge:
After The Merge, a full Ethereum node will be composed by the Beacon Chain execution client and a new consensus Proof-of-Stake (PoS) client communicating with each other using an API. By bundling these layers into a single piece of software, the UX of running a post-merge client would be very similar to what users are currently running - smooth sailing.
Figure 2 - The Merge Pandas!
In a somewhat comical livestream hosted by the EthStaker youtube channel, Vitalik and many client software’ representatives talked about the next steps and what to expect from the process with some music jam worth revisiting if missed.
Pre-merge, some Consensus Layer (CL) clients had issues tracking deposits to the beacon chain because they made specific assumptions around block times which did not hold under Ropsten's chaotic block times due to its variable hash rate as a testnet. These issues were all fixed before hitting the TTD and deposits to the beacon chain were all processed normally pre-merge.